Following the shocking 15% rise in electricity prices recently announced by Npower – the largest price hike in the electricity market since 2008 - ScottishPower has followed suit with news of price rises of up to 10.8 per cent affecting 1.1 million customers, and now E.On has stated electricity prices will rise by an average of 13.8%, affecting 2.5 million customers from April 2017.
This comes on top of the increase of 8.4 per cent to its electricity prices EDF had already announced in December, so consumers are bracing themselves for a round of energy price hikes this winter, with all three rises effective from March 2017.
But is there a way to beat these increases? Here, Computerquote reveals how switching and fixing your energy prices now could help you save a tidy sum for the future…
Five of the Big six energy providers' bills set to soar
Npower is planning to increase its standard electricity prices by 15% from 16th March, with gas bills to rise by 4.8%. A typical energy dual fuel bill will rise by an average of 9.8%, equating to an additional £109 a year. Customers on the company’s standard tariff will see their bills increase from an average of £1,077 to £1,186 a year. It is estimated this will generate Npower an additional £152 million a year. These increases are set to affect around half of Npower’s customers, with the other half protected from the price hikes by their fixed-term deals. It’s thought around 1.4 million UK customers on the standard rate tariff will be affected.
The price rises are thought to be the largest the electricity market has seen since 2008, when some suppliers raised their prices by as much as 19%. Gas suppliers last implemented similar increases in 2011. Comparison site Uswitch has identified this rise as the biggest increase to dual fuel bills since 2013.
This is the first time Npower has increased its prices for three years. The company has attributed this rise to increased energy wholesale prices and the cost of complying with government regulations, such as smart meters. The cost of wholesale electricity has increased by 36% since April 2016
Meanwhile ScottishPower has announced that it is raising the price of electricity by 10.8 per cent and the price of gas by 4.7 per cent with effect from 31st March. The cost of energy for a typical dual fuel household will rise by 7.8% on average.
SSE has now claimed that it will be increasing the price of electricity by a substantial 14.9 per cent but gas is to remain the same. This equates to £73 or 6.9 per cent added to the average dual fuel bill on standard variable tariff, pushing it to £1,142 a year. The increase, starting 28 April, has been attributed to the increasing costs of supplying electricity and Government "green energy" schemes.
EoN's dual fuel customers will see a price increase of 8.8 per cent by 26 April, with electricity prices rising by an average of 13.8 per cent, and gas prices by 3.8 per cent.
British Gas is now the only big six energy provider to freeze its electricity and gas prices until August.
What the regulators say
Energy regulator Ofgem has asked Npower to “justify” the price hikes to customers. The regulator has pointed out that while the wholesale prices have seen a sharp increase, many suppliers have bought energy in advance at a lower rate and should not yet be affected by this hike to wholesale prices.
According to the BBC, a government spokesperson commented that it is “concerned” by Npower’s plans to up prices, asserting that customers must be treated “fairly” and that this is a change which it is “prepared to act” on.
How can you freeze your prices for the year ahead?
Prices might be on the up, but there are steps you can take to protect yourself. Those customers already with Npower are being offered a four-year fixed-price tariff with a 4.8% discount. And those who aren’t with Npower could save themselves money in the long-run by locking themselves into a fixed-rate deal.
Although typically the cheapest deal on the market is the standard variable rate, a fixed-rate deal, which locks you into a rate for a set period of time, can often save you money down the line. Now is the time to join a collective energy switching scheme – the more people that join, the more your community can save on your energy bills. Find out more about the iChoosr collective switching scheme today.